"The effect was more pronounced among men than women - and worst among the elderly", it added.
They found that the longer people were exposed to polluted air, the higher was the damage in intelligence, with language ability getting more impeded than the mathematical ability.
Dr Xi Chen, from the Yale School of Public Health in the U.S., said this can have serious consequences for the elderly, as this is usually when the most critical financial decisions of their lifetime are made.
The researchers were able to show that the scores of the cognitive module of the test fell with increased long-term and transient exposure to air pollution.
The World Health Organization estimates 90 percent of the world's population breathes highly polluted air, with Africa and Asia being the most affected regions.
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"The damage air pollution has on aging brains likely imposes substantial health and economic cost, considering that cognitive functioning is critical for the elderly to both running daily errands and making high-stakes economic decisions", Xiaobo Zhang, a co-author, said, CNN reported.
"This latest study matches with previous research", says Derrick Ho of Hong Kong Polytechnic who has worked on the health effects of extreme weather events like haze. It needs to realise that the deadly air pollution causes losses not only to the families concerned but also to the nation as it has serious implications for the national productivity, in particular.
The reasons for the impairment are ambiguous but according to the study, the decreasing performance of those observed could be due to behavioural changes caused by air pollution.
The result of that action, if allowed to stand, will subject all U.S. citizens to higher levels of air pollution in the name of boosting profits for fossil fuel companies.
The study also found that death rate from air pollution has increased.
The researchers found that the life expectancy impact of ambient PM2.5 is especially large in polluted countries such as Bangladesh (1.87 years), Egypt (1.85 years), Pakistan (1.56 years), Saudi Arabia (1.48 years), Nigeria (1.28 years), and China (1.25 years).